Australian Storage

We find ourselves in an amazing event right now!
I predict here the biggest paradigm shift in Australian consumer history. The tables are about to be turned on the most insidious business in everyone's lives.
The electricity suppliers/retailers are on a precipice they have unwittingly carved themselves by the relentless pursuit of (contractually GUARANTEED!) increasing profits.

Background

Under the dubious (dis)guise of "Competition", fanfared by Australian State Governments eagerly relinquishing their "performing" assets for cash to soften their deficits, into the hands of equally eager Corporations, our power "utility" has morphed into a greedy monster which has inflicted such a significant financial burden on the average Australian power customer, that it's resulted in people actually accomplishing substantial power (consumption) savings via various initiatives including appliance/plant replacement for more energy efficient units, and compliance with the incandescent bulb ban of 2009. In addition, solar incentives have been well exploited by consumers hungry for more effective and permanent energy savings.
The result is a dramatic decline in electricity consumption, with commensurate loss of revenues for the energy businesses.
These losses have been so significant that suppliers/retailers have had to ratchet up the kWh price accordingly, to protect their profit profile. 
In graphical form, their problem looks like this...

Australian electricity consumption KWh per capita

Source: EGA 2014, Bureau of Resources and Energy Economics (BREE) 2014

The game changer!

Not surprisingly, the game changer was already lurking in the shadows of some customers' savings excursions. Of course it had always been the heart, arguably, of all remote, non-grid connected, installations ranging from humble farm setups to mining enterprises with significant energy needs. The simple, humble storage battery has been hard at work for decades in such environments, ensuring that generators of many types could have a rest from time to time, or, in the event of a generator failure, continue to maintain vital electricity supply to critical equipment ranging from telephony equipment to mine lighting and even medical equipment.

More and more has been demanded from batteries over the years and in recent times the advent of it's supply cohort, the inverter, to maintain AC supply to household appliances has developed a whole new market driven by the mobility of ordinary travellers choosing caravans and "RV's" as their mobile accommodation.

But, in fact, the battery (concept) is not the game changer, and yet it is.

That's a bit confusing! Well let me explain....

Until a few years ago the most common battery types for medium sized applications, such as the RV environment, were the sturdy lead-acid type. Heavy but reliable, and with adequate capacity and good efficiency, they provided an acceptable solution at an affordable price.

THEN, along came the EV! The Electric Vehicle easily adapted the battery storage to supply the electric motor for adequate performance but poor range.

As more and more enthusiasts, and eventually entrepreneurial manufacturers, embraced the possibility that an EV could have range and performance, the hunt was on to find or develop the better battery! Nickel Metal Hydride batteries first appeared in the late '90's in the first "mass produced" EV of the day, GM's EV1 "second series", replacing Lead-Acid batteries in the initial builds.

But even that's not the game changer!

The startling appearance of the Tesla Roadster in 2008, powered by thousands of Lithium Ion laptop cells, heralded a paradigm shift in battery application.

Rather than using larger form factor batteries, the demands of range, performance, durability and compactness identified the unexpected solution, many small cells.

But that's still not the game changer!

What really delivered the final element was the extraordinary commitment by Tesla Motors, producers of the Tesla Roadster, and now the highly successful and highly acclaimed Tesla S electric sedan, to establish battery manufacturing (of these Li Ion batteries) on a "Giga" scale, i.e. producing them in massive quantities in "Gigafactories". Three of these are to be built, with construction of the first in California, well underway. Tesla's battery partner Panasonic will also reap the benefit of the resultant price reductions this scale of production will deliver. Tesla will have millions of these cells coming of the production line at a rate which their car manufacturing process could hardly consume. There'll be shiploads produced every month and they need to be sold! So, now comes the game changer, the Tesla Powerwall, already on offer today at a USD price of $3,500 (approx AUD$4,500), for a 10kWh unit, which is a price point at a mere fraction of a locally available battery pack of similar (9.2kwh) capacity for AUD$8,650.

So where are we headed?

The future prospects for power companies are the same as always, rosy, and perhaps now even better thanks to this new game-changer. Just like before they will continue to grow their profits courtesy of their Government mandated profit guarantees, and might possibly even make more "value added" business profit introducing the "average customer" to the "benefits" of battery storage "solutions" they will supply.

As for you and me, well we don't have a Government mandated guarantee that we will pay less for anything, let alone electricity. Even if we "invested" in RTS, and now batteries, to attempt to reduce our energy spend we now countenance the prospect of paying even more to remain "grid-connected". These pricing impacts reflect a game-changing move on the part of the energy companies to head in the direction the telecomms businesses have offered for a long time; fixed priced plans with consumption limits that trigger massive penalty changes, just like when you exceed your internet "download" limit.

Many people are seriously considering going "off-grid" to escape the looming price gouges, but the bad news for those is, unless you live in a other than a metropolitan environment, you won't escape the "connection" charges, as the grid passes your property. So, can you go off-grid? Well, actually, yes you can. In fact, throughout Australia, thousands go "off-grid" every year, when they fail to pay their electricity bill. The only problem with this method is it affects your credit rating, as you've defaulted on your supply contract.

The next 18 months are going to keep us all on our toes trying to avoid continuing price hikes and figure out how to beat the suppliers. Good luck with that!